Correlation Between Dataprep Holdings and Hong Leong
Can any of the company-specific risk be diversified away by investing in both Dataprep Holdings and Hong Leong at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Dataprep Holdings and Hong Leong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dataprep Holdings Bhd and Hong Leong Bank, you can compare the effects of market volatilities on Dataprep Holdings and Hong Leong and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Dataprep Holdings with a short position of Hong Leong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dataprep Holdings and Hong Leong.
Diversification Opportunities for Dataprep Holdings and Hong Leong
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Dataprep and Hong is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Dataprep Holdings Bhd and Hong Leong Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hong Leong Bank and Dataprep Holdings is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Dataprep Holdings Bhd are associated (or correlated) with Hong Leong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hong Leong Bank has no effect on the direction of Dataprep Holdings i.e., Dataprep Holdings and Hong Leong go up and down completely randomly.
Pair Corralation between Dataprep Holdings and Hong Leong
Assuming the 90 days trading horizon Dataprep Holdings Bhd is expected to generate 8.17 times more return on investment than Hong Leong. However, Dataprep Holdings is 8.17 times more volatile than Hong Leong Bank. It trades about 0.11 of its potential returns per unit of risk. Hong Leong Bank is currently generating about 0.16 per unit of risk. If you would invest 13.00 in Dataprep Holdings Bhd on November 28, 2024 and sell it today you would earn a total of 1.00 from holding Dataprep Holdings Bhd or generate 7.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dataprep Holdings Bhd vs. Hong Leong Bank
Performance |
| Timeline |
| Dataprep Holdings Bhd |
| Hong Leong Bank |
Dataprep Holdings and Hong Leong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dataprep Holdings and Hong Leong
The main advantage of trading using opposite Dataprep Holdings and Hong Leong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dataprep Holdings position performs unexpectedly, Hong Leong can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Hong Leong will offset losses from the drop in Hong Leong's long position.| Dataprep Holdings vs. Apex Healthcare Bhd | Dataprep Holdings vs. Choo Bee Metal | Dataprep Holdings vs. TAS Offshore Bhd | Dataprep Holdings vs. Aeon Credit Service |
| Hong Leong vs. Choo Bee Metal | Hong Leong vs. Lyc Healthcare Bhd | Hong Leong vs. Press Metal Bhd | Hong Leong vs. Central Industrial Corp |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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